Dato� Raja Azwane Bin Raja Ariff&1lagi V Dato� Man Bin Mat&2lagi

  

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DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR

 

(BAHAGIAN DAGANG)

 

SAMAN PEMULA NO: D-24NCC-35-2010

 

Di Dalam Perkara Mengenai Perjanjian Jual-Beli Saham bertarikh 8 haribulan Februari 2007 di antara Dato’ Raja Azwane Bin Raja Ariff, Dato’ Tan Kim Kuan, Dato’ Man Bin Mat dan Datin Maryna Keh Binti Abdullah

 

DAN

 

Di Dalam Perkara Mengenai Aturan 7 dan Aturan 28 Kaedah-Kaedah Mahkamah Tinggi, 1980

 

DAN

 

Di Dalam Perkara Mengenai Seksyen 11, 18, 21 dan 41 Akta Relif Spesifik, 1950.

 

ANTARA

 

DATO’ RAJA AZWANE BIN RAJA ARIFF

 

DATO’ TAN KIM KUAN …PLAINTIF-PLAINTIF

 

DAN

 

1. DATO’ MAN BIN MAT

 

(No. K/P: 500602-08-5381)

 

2. DATIN MARYNA KEH ABDULLAH (No. K/P: 490325-10-5826)

 

3. MD NIZAM BIN MD SHERIF

 

(No. K/P: 7003052-02-5581)

 

…DEFENDAN-DEFENDAN

 

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GROUNDS OF DECISION

 

This is an application (Enclosure 7) by the 2nd Defendant under Order 18 rule 19 (1) (b) and (d) to strike out the prayers in the Plaintiffs Originating Summons so for as it affects her on the ground that these prayers are scandalous, frivolous or vexatious or otherwise constitute an abuse of the court’s process. The subject matter of the claim concerns a Share Sale Agreement entered into between the 1st and 2nd Defendants on the one hand and the Plaintiffs on the other which was entered on 8th February 2007 for the Sale and Purchase of shares in a company named Maya Maju (M) Sdn Bhd. This Agreement appears as Exhibit “RA-2” to the Supporting Affidavit.

 

The 1st and 2nd Defendants were originally the only shareholders of the Company. By this Agreement, the 1st and 2nd Defendants agreed to sell their shares to the Plaintiffs on specific terms and conditions. The 1st Defendant disposed part of his shareholding, but the 2nd Defendant sold her entire shareholding of 1.45 million shares in the Company. The total consideration paid by the Plaintiffs was RM 5,000,000.00. Both were also Directors at that material time. The 1st Defendant remains a Director presently, but not the 2nd Defendant. The 2nd Defendant, having sold her entire shareholding in the Company, resigned as Director a few days after the date of the Agreement, to be exact on 12th February 2007. According to her, from that date she has had nothing to do with the Company. Counsel for the 2nd Defendant states her case in the striking out proceedings thus: The present suit against her is for specific performance of certain alleged obligations to be performed either by the

 

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existing shareholders or the Company; she is not in a position to comply since she is presently an outsider vis-a-vis the Company. Relying on propositions of law in Spry’s Equitable Remedies and the case of Wormington v Miller, counsel argues there cannot be specific performance ordered if its effect is to compel the 2nd Defendant to do what she is not legally competent to do. Further, by looking at the pertinent Clauses in the Agreement, she is not a “party” required to perform by the very provisions in the Agreement. The provisions relevant here are Clauses 3.1 (f) and 14.12. Clause 3.1(f) concerns one condition precedent to completion of the Agreement and the parties had agreed to “use their best endeavours (where appropriate) to satisfy, and assist one another to satisfy the Conditions Precedent.” This particular condition precedent relates to the Novation and Assignment of the Agreement between Jabatan Kerja Raya Malaysia and the Company is respect to the design and construction of the new “Istana Negara” to a joint venture company known as Gagasan Ikatan Sdn Bhd, with a shareholding structure which mirrors that of the Company after the Share Sale Agreement, namely:

 

Dato’ Man bin Mat 30%

 

Md Nizam bin Md Sherif 20%

 

Raja Dato’ Azwanee bin Raja Ariff 25% Dato’ Ir. Tan Kim Kuan 25%

 

The Defendant points out that Clause 14.12 refers to obligations of “the shareholders, as described above” to amend the Memorandum and Articles of Association of the Company to reflect the Agreement between the parties, and the 2nd Defendant has ceased to be a

 

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shareholder and is not described as one of the shareholders. Therefore as far as this particular obligation is concerned, it will be out of her power to perform. The other obligation relates to the contractual promise by the vendors (of which she is undoubtedly one) to cause the JKR contract to be assigned to the joint-venture Company.

 

Perusing the prayers for relief in the Originating Summons, these include not merely a claim for specific performance, but include as well declaratory reliefs, and damages for breach of contract in the alternative. Thus the claim for specific performance does not stand on its own, and even assuming the arguments raised have validity in relation to the striking out application, which I very much doubt, a claim for damages cannot in the circumstances be construed as scandalous, frivolous or vexatious or otherwise an abuse of the court’s process.

 

The rules relating to striking out are clear on the available authorities. The case must be “obviously unsustainable”, which means to say, the court has to be convinced not only that the claim is unsustainable, but that is must also be “obviously” so. The claim must be plainly or evidently unsustainable in law on the face of the claim: Pet Far Eastern (M) Sdn Bhd v Tay Young Huat & Ors [1999] 5 MLJ 558. See also Bandar Builders Sdn Bhd & 2 Ors v United Malayan Banking Corporation Bhd [1993] 4 CLJ 7, for an allied proposition: the discretion to strike out “cannot be exercised by a minute examination of the documents and facts of the case…” and “if there is a point of law which requires serious discussion…” The discretion to strike out therefore has to be sparingly exercised.

 

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On the facts of this application and on the established applicable principles, I am not persuaded the case is so obviously unsustainable as to merit striking out.

 

Application (Enclosure 7) dismissed with costs RM 1,500.00 to be paid by the 2nd Defendant to the Plaintiffs within 14 days from the date of this Order.

 

Sgd.

 

( MOHAMAD ARIFF BIN MD. YUSOF ) HAKIM MAHKAMAH TINGGI DAGANG NCC 3 KUALA LUMPUR

 

Dated 15 June 2010.

 

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COUNSELS

 

For the plaintiff: Ramesh

 

Messrs. Chellam Wong.

 

For the defendant: Sampath Sivam

 

Messrs. Kumar Associates

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